05/06 CWB Initials prove need for CWB Reform

[TOM4CWB]

Charlie;

I have been astounded at the lack of outrage over present initial prices!

WHy aren't people outraged?

I sent a couple of letters to Minister Alcock about CWB reform, here the liberals at 100% in charge!

Last E-mail:

Dear Richard/Minister Regis Alcock:

Thank You for being blunt in your reply.

Your Election Review Panel was not democratically elected and has no mandate to implement recommended changes included in this process. Few farmers take the CWB election review panel seriously.

Clearly the recommendations of the Election Review Panel will be subject to the same process as the Western Grain Marketing Panel Report; you said "won't move the file fwd".


Therefore their Report is unlikely going to be taken seriously particularly in the present political environment.

CWB Directors have come to you with proposed changes to the CWB Act/kinder initials that wouldn't have been so much of a disaster;

Instead, Your gov. chooses to punish western Canadian grain farmers.


Now it rains and sprouts the wheat and barley.


Judgment.
We pay for liberal ways.

So The western Canadian grain sector is in a "BSE" crisis state caused by the Liberals in Ottawa.

The CWB average initial 48lb (2CW) feed barley price;
($1.48/bu) that is, 5 and 20 cents per bushel in MB and SK
(costs to port of $1.43 and $1.28/bu [http://www.cwb.ca/db/contracts/pool_return/pro.nsf/WebPRPub/2005_20050825.html]) respectively.

Your 60lb/bu CW Feed wheat initial is being paid at $1.99/bu; that is 56 and 50 cents per bushel in MB and SK
(costs to port of $1.43 and $1.49/bu [http://www.cwb.ca/db/contracts/pool_return/pro.nsf/WebPRPub/2005_20050825.html]) respectively.

How do you expect us to pay our bills on this revenue this fall?

I know, Don't use the pool accounts; the theoretical marketing advantage farmers most claim, of the CWB.

A wise man once said; "Never underestimate the power of stupid people in large groups."


Truly,
Thomas R. Jackson

c.c TO Whom It May Concern




-----Original Message-----
From: Phillips.Richard@tbs-sct.gc.ca [mailto:Phillips.Richard@tbs-sct.gc.ca]
Sent: Thursday, September 08, 2005 8:59 AM
To: tjackson@connect.ab.ca
Subject: RE: CWB and Democracy


I won't use up much of your time, and we may simply have to agree to disagree on this Tom, but we firmly believe in the ability of farmers, with appropriate election and balloting rules in place, to elect candidates reflective of their views, who can then, as Directors of CWB either make changes there, or come to us with a proposal for change.



Past reports, which were done before the farmer elected board was put in place, won't move the file fwd, although they are a good source of information.



Have a safe harvest Tom, and keep working on me coming share the Afghan story in Edmonton. It is unfortunate we, as a society, don't spend more time giving thanks for the many blessings we have, rather than worrying about the ones we don't. I saw a piece on the news a day ago, and it was a pastor in New Orleans, making the point that from the disaster, people are learning to appreciate the simple things again, and are moved to give more thanks.





Dad called this morning to say they just got rolling again last night after 10 days of wet weather, but it is raining again this morning.



I have 60% of my acreage in alfalfa for the dehy industry, and so will do fairly well financially with the moisture we had this year. Makes me almost not want to bother doing up the 2005 CAIS supplementary paper work.



Richard



-----Original Message-----
From: Tom Jackson [mailto:tljacks@telus.net]
Sent: September 8, 2005 2:31 AM
To: Phillips, Richard C.
Subject: RE: CWB and Democracy



Richard/Minister Alcock:



Many of The Western Grain Marketing Panel Report recomendations have still not been implemented. Could Minister Alcock complete this task that Minister Goodale refused complete; to implement the rest of these recomendations?



This is a real part of the frustration about CWB reform.



Seeding winter wheat and combining all at the same time.



Truly,

Tom Jackson









-----Original Message-----
From: Phillips.Richard@tbs-sct.gc.ca [mailto:Phillips.Richard@tbs-sct.gc.ca]
Sent: Wednesday, September 07, 2005 11:07 AM
To: tjackson@connect.ab.ca
Subject: RE: CWB and Democracy

Or is this Election Review simply a process to raise my blood pressure and make my life difficult?



Believe it or not Tom, we are not doing this just to make your life difficult. There have been some excellent presentations to the review panel on how to change the elections to make them more meaningful and credible.



In Ontario, I believe the farmers themselves decided they wanted the dual market. I f you have suggestions on how CWB elections should evolve similar to Ontario, I hope you will take the time to submit them to the panel, which is operating at arms length.



I am looking fwd to their report this fall.



How is harvest going?



Richard



-----Original Message-----
From: Tom Jackson [mailto:tljacks@telus.net]
Sent: September 7, 2005 9:15 AM
To: Phillips, Richard C.
Subject: CWB and Democracy



Dear Richard and CWB Minister Regis Alcock;



When Ed Micheals from Ontario presented to us at Jim Chatenay's meeting in District 2 a couple of years ago, he brought these points amongst many others to our attention regarding needed CWB reforms.



1. Q: Is the CWB farmer owned?



A: No. Not one share is owned by a farmer, only the GOC owns 100% of the CWB Corporation.



Please tell the CWB to stop insulting me by spending my money telling me that they are farmer owned.



2. Q: Does the CWB have annual meetings that farmers can bring foreword resolutions that will be binding on CWB Management?



A: No. Farmers can not even bring foreword any resolution, as no official annual meeting that binding decisions occur, has ever taken place.



How can this be democratic?



3. Q: Is the CWB accountable to western Canadian farmers?



A: No. You folks just turned down the CWB Board of Directors recommendations on initials... and implemented your own. The most important decision of the year.



The CWB is accountable to not one farmer in western Canada... and we are reviewing an election process that is to put a façade of democratic accountability on the CWB. WHY?



4. Q: What is the purpose of the CWB?



A: The same as 1943, to keep the price of food as low as possible, first for Canada... then for the rest of the world that are the Canadian Gov's friends.



Are you serious about any CWB reform that is meaningful?



Or is this Election Review simply a process to raise my blood pressure and make my life difficult?



This affects FARM people's heath, physically, emotionally and financially, especially in the grain farming sector.



Please, show some true leadership and do the right thing.



With The highest costs in history.



The answers to the first three questions needs to be YES, and the fourth needs to be to maximise grain farmer's returns.

Please reform the CWB Governance structure to reflect these needs.



Is it reasonable that Ontario has a democratically managed Wheat Board, but not Western Canada?



Over 10 years ago, we protested these unreasonable GOC CWB burdens on our Farms.



Alberta Farmers went to jail protesting the above problems.



What more must we do to get your attention, including true democratic reform?





Yours Truly,







Thomas R. Jackson



C.C. Premier Ralph Klein

James Chatenay

[silverback]

I think people are outraged, but stronger than the outrage is the complete lack of hope for anything better from this government, federal and provincial.

Most farmers who want some change and who have stood up in the past just get tired of nothing ever happening.

We have asked Alberta to take some sort of initiative and all we get are more broken promises. Broken promises even from the people we thought were on our side. We have learned that all they want is to say enough to get re-elected and then scurry down their holes.

This is not democracy.

p.s. Does his letter imply that we should get out of the grain business and into hay instead?

[wd9]

The problem is there is too much grain and oilseed in the world. We produce too much and continue to make the problem worse by using more expensive fertilizer feeling higher yields are the solution. Two solutions exist, have everyone in the world eat like we do here in Canada, or produce a lot less product and the price will go up.

One day the numbers will change, might take 50 years though. Supply demand curves apply to grain farming too. No CWB election reform will ever solve this fundamental economic reality.

[silverback]

Just wondering why the board dropped the initial payment so much and then announce $30 in cash available to the cash advance program? Is it just coincedence? Maybe I am not thinking straight as usual.

[melvill]

I hear the strong complaints about the low initial payments. Some of the initials this year are at or even below the 50% of the PROs and that creates cash flow problems.

However, I'd like to ask why producers aren't using the Early Payment Option to bring those initials up to, at least, 80% of the PRO, which is higher that the initials were before the recent lower initials over the last two or three years.

The premium for the 80% EPO all the wheats is 3 cents/bu.(Sept 9, 05). To me the decision to use the 80% EPO is about the same as doing up seatbelts.

So how come more (or all) producers aren't using the EPOs?

[TOM4CWB]

melvill;

Why should we have to pay a premium to recieve money for grain that is ours, and money that is ours.

The CWB MUST provide a daily cash price, every day of the year, with the basis reflecting a fair return (since the CWB claims to charge only true costs); this is the principal reason a benefit "could" accrue to us as grain farmers from the CWB marketing system.

Instead the highest marketing cost is to get a cash price, and the lowest basis cost accrues to those in the pool accounts, at least in theory. THis is backwards to the way economic theory works in open markets... (which the CWB works in)unless the hidden costs of pooling are ignored.

CWB cash prices are created from pooled grain, that is cash priced grain is sold through the pooled grain accounts... and a true cost benefit analisis cannot be created because everything is backwards.

Complex?

Intentionally made so.

Do you understand it Lee?

Charlie, Do you even understand all the perverse twists this does to a cash sales program and the opportunity to lowball cash prices?

The CWB sales managber can literally make up what ever prices they feel like making! With no real basis in reality whatsoever!

[melvill]

tom4cwb, you asked the question of 'why should we pay a premium . . . ?' Quite aside from the daily cash price issue, the reason for paying the premium for the EPO is pretty obvious. U.S. trade law and the bodies that administer it viewed the federal gov't guarantees of the initial price (and other guarantees) as a subsidy. So, the feds would guarantee higher CWB initial payments - all of which you know.

So, in the meantime, if producers want more than the present meagre initials, we (and I'm one of them) must be prepared to pay the tiny 3 cents/bu. premium for the 80% EPO.

The question still is 'why don't more producers understand and use the EPO?'

[TOM4CWB]

Lee;

The LDP is the USA's initial garrantee for US grain farmers.

In many cases it pays even when grain farmers haven't lost money below the LDP value.

So why don't we have a LDP in Alberta, and solve the problem for good!

This would be much better than an 80%EPO, wouldn't it LEE?

[charliep]

Loan defiency payment is a government price support mechanism. The somewhat (not total) equivalent in Alberta is revenue insurance.

Lee's question is relavent given the program on costs a buck or two a tonne at 80 %. Why don't 100 % of farmers use it?

It is also likely something the CWB could offer as a standard feature today. Federal government guarantees first 60 % of last PRO and CWB does the next 20 %. The CWB would have to be a more active risk manager to protect the pool (using the same procedures they use with the EPO today) and be prepared to do things like close the pool early if sales at the end of the crop year potentially push the pool into a deficit. It would also impose discipline on sales at the low end of their customer price spectrum - no give aways.

[TOM4CWB]

Charlie;

All you have said is fine... but,

If the CWB is here to MAXIMISE my returns, why should I pay for something that is a prime purpose for the marketing organisation's existance? further, why doesn't the fed just approve the CWB plan (GOC finance must do this as a matter of process by CWB Act requirement) and pay us 80% of the value of our grain!

Better yet, pay us a daily cash price of 100%!

The Revenue protection Alberta provides, COSTS a premium/is premium based, isn't it true the LDP in the USA is FREE for grain farmers?

Yet it (the US LDP) is WTO acceptable?
WE have not applied to the WTO, for duties on US LDP price enhanced grain coming into Canada or Alberta, have we CHarlie and LEE?

WHY NOT?

IF it is fine under the WTO, then why isn't the LDP incorporated it into CWB initials?

Why must the GOV of Canada just suck the life out of western grain farmers?

[silverback]

You are just asking too many valid questions for the CWB right now Tom. They are going to have to hire some more staff to find the correct way to spin a confusing answer to your questions, thus satisfying the poor huddled masses that depend on big brother and his obvious wisdom.

[Vader]

tom4cwb, you asked

"Why should we have to pay a premium to recieve money for grain that is ours, and money that is ours. "

The money you receive when you deliver grain is an advance. The CWB must borrow the money to give you this advance. The grain has not yet been sold so there is no money. The money will only come once the grain has been delivered and the customer invoiced and payment received. In the meantime there is no money unless it is borrowed. If you want a higher level of initial payment there are costs to be borne.

It is no different than when I sell a non-board grain and the buyer has not yet sent me a check. It is not my money until it is in the bank. Certainly it is money that is owed to me. It is a receivable. I have a receivable but I don't have the money. It is my receivable. It is not my money.

So the simple answer to your question "Why should we have to pay a premium to recieve ... money that is ours." It is not your money. You want an advance. You simply have to pay the costs associated with getting that advance,..... admin costs, risk premium and time value of money.

It really is that simple.

[TOM4CWB]

Vader;

I suppose you are right in that it is not my wheat or barley that I grew, but the CWB/GOC's wheat and barley. Please excuse me for forgetting I work for the CWB/GOC.

In the end Vader;

Can the CWB stand alone against the US/EU on the monopoly issue...

Is it wise to believe the GOC will die for the CWB on the monopoly at the WTO; after Treasury gutted our 05/06 initial prices Vader?

Is the CWB monopoly more important than CDN supply management Vader?

On my $9 canola, when I deliver I get paid. On my $3.50 peas, when I deliver I get paid.

End of story, no excuses, it is my money. Further, I had the choice on who I did the business with.

[Vader]

tom4cwb,

I assume that you are intentionally missing my point. I did not say that it was not your grain. I said that after you deliver your grain to the elevator that it is not your money. The grain has not been sold and the money has not been collected. You have a receivable and that is all.

[TOM4CWB]

Vader;

You said: "after you deliver your grain to the elevator that it is not your money. The grain has not been sold"...

I must contract my wheat to the CWB, and do it for the largest percentage long before delivery.

WHY didn't the CWB sell it?

In my other grain marketing of non-board grain, normally give notice many months ahead to these marketing partners that we are doing a transaction... so they can plan and complete the transaction in an orderly manner.

I thought this was the purpose of the CWB contracts. Perhaps we should return to acreage/bu calls without contracts... if the contracts have no valid purpose in making CWB forward sales decisions.

But Vader, a reasonable person would question how and why the CWB does what they do.


Malt Barley for example.

We are killing our value added industry using the CWB.

Maltsters pay for example, $3.50/bu for malt bly to the CWB, yet the CWB pays the western CDN bly grower $2.50/bu.

When asked where the rest of the money goes... the CWB pointed out it was an "industry secret" and confidential commercially sensitive information.

CROSS SUBSIDISATION to the export market VADER. It happens in all CWB marketing pools. The EU and US are sick of it.

Again, what makes the CWB think the CWB will keep, in this WTO neg.round, the ability to abuse "monopoly" and hurt all of us?